Late bid to top Rinehart’s $370m for S.Kidman & Co

A $400 million bid for Australia’s largest landholder S.Kidman & Co from a fund backed by up to 50,000 ordinary superannuation funds to be lodged later this month. 
The attempt comes days after Australia’s richest person Gina Rinehart and her Chinese joint venture partner Shanghai CRED launched a $365 million bid which could be approved within six weeks following vocal support from politicians.

MP Bob Katter has asked whether any federal ministers new about Mrs Rinehart’s proposal before knocking back a Chinese bid for Kidman before the last election, suggesting something untoward.

Other late bids are also expected. Family syndicate BBHO – representing family names Brinkworth, Buntine, Harris and Oldfield – is believed to be lodging a bid later this month which could see a break up of Kidman’s 10.1 million hectares.
However, the legitimacy of these bids is being questioned especially given how late they have come and how sophisticated their funding structures are for such a major investment.  

Steve Burgin, an ASIC licensed adviser with Melbourne-based financial planning group Interprac, issued a statement on Friday confirming that a major trustee had 50,000 clients pre-registered to commit part of their super funds to direct agricultural interests. 

The trustee was thought to be ASX listed Equity Trustees but a spokesman for the company said in a statement that: “[Equity Trustees], nor its clients, are involved in any funding or any bid, for S. Kidman and Co.”

Mr Burgin said in a statement that the bid would come before the end of the month. 

“There’s no doubt the Kidman sale has opened many ordinary people’s eyes to the opportunity of being part of Australia’s pastoral industry via their superannuation funds, and we are keen to progress our plan to see that happen for as many of them as possible,” Mr Burgin said.

“The superannuation fund plans to open the door for many Australians to participate in the acquisition of S. Kidman & Co before the end of October.

“A bid price is anticipated to be in excess of $400 million for the Kidman shares,” he said.

The structure of the new fund is open to joint-venture partners and other investment vehicles such as fractional property investment platform Domacom which decided earlier this week to abandon its Kidman campaign.

S.Kidman & Co appointed EY’s Don Manifold to conduct the sale process for the business early last year.

Mr Manifold said the sale process still allowed superior bids to Mrs Rinehart’s to be lodged and considered.

“As a public unlisted company with more than 50 shareholders, under-bidders or parties not directly participating in the sale process still have an opportunity to submit a takeover offer,” Mr Manifold said.

“Under this structure, at any time throughout the process until the takeover offer closes, parties can submit a superior proposal for acquisition of the company. If a superior proposal is received, and [the Rinehart joint venture] does not exercise their matching right under the BIA, directors have a duty to put that superior proposal to shareholders.”

More than 600 interested parties have made contact with sales manager EY since April 2015.

Kidman’s managing director Greg Campbell said new bids would be considered.

“The process is still far from over, as rules around the sale of a public unlisted business with more than 50 shareholders mean that under-bidders or parties not directly participating in the sale process still have an opportunity to submit a takeover offer at any time throughout the process until the takeover offer closes.”
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